In this edition of The Taxpayers’ Advocate, Jack Trachtenberg and Jason Feingertz discuss the unique tax considerations for professional athletes, particularly those regarding residency. However, most of the issues and concepts discussed apply to any high income individual with multiple homes or whose business or profession involves extensive travel or frequent changes of employer or work location.

Athletes present a unique set of tax considerations when determining their true homes. That leads to a lot of questions and opportunities when considering their residencies for state tax purposes. For example, athletes may be able to change their residencies from state to state throughout their career depending on the teams they play for, or view their true homes as the places they spend their off-seasons, irrespective of where their teams are located. When athletes change teams, they may have opportunities to revisit their residency status, which can have significant tax implications. Indeed, all athletes should give serious thought to their residency status during two critical moments of their careers: when they are drafted and the first time the player reaches unrestricted free agency.

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